Correlation Between Shanghai Shuixing and Sinomach Automobile
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By analyzing existing cross correlation between Shanghai Shuixing Home and Sinomach Automobile Co, you can compare the effects of market volatilities on Shanghai Shuixing and Sinomach Automobile and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Shanghai Shuixing with a short position of Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Shuixing and Sinomach Automobile.
Diversification Opportunities for Shanghai Shuixing and Sinomach Automobile
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Sinomach is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Shuixing Home and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile and Shanghai Shuixing is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Shanghai Shuixing Home are associated (or correlated) with Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Shanghai Shuixing i.e., Shanghai Shuixing and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Shanghai Shuixing and Sinomach Automobile
Assuming the 90 days trading horizon Shanghai Shuixing Home is expected to generate 0.67 times more return on investment than Sinomach Automobile. However, Shanghai Shuixing Home is 1.49 times less risky than Sinomach Automobile. It trades about 0.03 of its potential returns per unit of risk. Sinomach Automobile Co is currently generating about 0.0 per unit of risk. If you would invest 1,301 in Shanghai Shuixing Home on September 4, 2024 and sell it today you would earn a total of 307.00 from holding Shanghai Shuixing Home or generate 23.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Shuixing Home vs. Sinomach Automobile Co
Performance |
| Timeline |
| Shanghai Shuixing Home |
| Sinomach Automobile |
Shanghai Shuixing and Sinomach Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Shuixing and Sinomach Automobile
The main advantage of trading using opposite Shanghai Shuixing and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Shuixing position performs unexpectedly, Sinomach Automobile can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Sinomach Automobile will offset losses from the drop in Sinomach Automobile's long position.| Shanghai Shuixing vs. Industrial and Commercial | Shanghai Shuixing vs. China Construction Bank | Shanghai Shuixing vs. Agricultural Bank of | Shanghai Shuixing vs. Bank of China |
| Sinomach Automobile vs. Guangdong Jingyi Metal | Sinomach Automobile vs. Gem Year Industrial Co | Sinomach Automobile vs. Ye Chiu Metal | Sinomach Automobile vs. Shenyang Huitian Thermal |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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